The preliminary draft of the civil liability reform in France

October 2016 | EXPERT BRIEFING | LITIGATION & DISPUTE RESOLUTION

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Following the French contract law reform of 11 February 2016, the second step of the French civil law modernisation has been launched. On 21 April 2016, the French Ministry of Justice published a preliminary draft of the civil liability reform, subject to a three-month public consultation period.

At the end of this public consultation, the reform project should be amended in light of the contributions sent by any party interested. Then a consolidated draft will be submitted to the Council of Ministers during the first quarter of 2017. While there is little chance to see this draft being discussed in parliament during François Hollande’s presidency, this reform project will help set the stage for a modernised French civil liability.

This preliminary draft is a satisfactory compromise between the earlier Catala and Terré proposals. The civil liability reform programme was welcomed with open arms for several reasons. Dispersed, the current civil liability law becomes increasingly inaccessible and hard to understand for any person, lawyer or layman, French or foreigner. As it stands, the current reform of the civil liability regime does improve accessibility of sources and predictability of the law. Moreover, as the current civil liability law is based on few articles unchanged since the codification of 1804, supplemented by case law, such reform was necessary to modernise and clarify principles relating to civil liability.

The draft, made up of 72 articles, essentially codifies the principles established by case law since the implementation of the French Civil Code, but also brings several clarifications. For example, the preliminary draft formally recognises compensation in kind in the contractual context, keeping in mind that such compensation cannot be imposed on the victim (which is new), and that it should be excluded in two cases – impossibility (a rule admitted for a long time) as well as when it leads to a manifestly unreasonable cost for the person liable (article 1261). This provides a useful clarification of the rule. Another important change compared to the current law is the possibility of benefiting from clauses limiting or exonerating liability in the case of liability without fault for extra-contractual law (article 1282). Nevertheless in this case, clauses cannot be used to limit compensation for personal injury and the parties should be aware of the introduction of such a clause.

Needless to say that this reform provides more predictability and clarification than the current law under which these principles are not firmly approved and applied by the French Supreme Court. In addition to the codification of remedies set by case law, the current reform has also withdrawn several outdated principles and introduced new innovative measures.

The withdrawal of obsolete remedies will lead to some kind of modernisation of the French civil liability rules. It is worth mentioning that several articles of the French Civil Code have remained unchanged since the implementation of the French Civil Code in 1804 and became outdated and inadequate in current modern society. For instance, the current draft has withdrawn the specific regime instituted by article 1386 of the French Civil Code providing that “the owner of a building is answerable for damage occasioned by its ruin, when this is caused by a failure to maintain it or by defect in its construction”. Indeed, specific regimes such as these are no longer necessary as they can be included in the general liability regime for the damage caused by things which are in our custody (article 1243).

Besides, the preliminary draft introduces new innovative measures, which clearly improves the current civil liability law. Among them, the creation of a civil penalty to punish gross faults, and in particular ‘lucrative faults’ (article 1266), or even the introduction of the rule of termination of a wrongful act (1232). With those new rules, civil liability law has not only a reparative function but also a preventive and deterrent one.

Furthermore, influenced by the Catala project, the draft establishes common rules on reparable loss and a causal link for contractual and extra-contractual liability (articles 1235 et seq) while maintaining a separate regime for both of them. The draft confirms the existence of fault-based liability (articles 1241 and 1242). However, and this is unfortunate, the draft does not propose any definition of the causal link. Another new measure is the implementation of a specific regime for the reparation of losses resulting from personal injuries (article 1267 et seq). According to the draft, the compensation of personal injuries must be governed only by extra-contractual liability, even if the damage were to occur during the performance of a contract (article 1233 para 2). Measures relating to compensation for environmental damage are also introduced (subsection 3 Rules specific to the reparation of losses resulting from environmental damage).

Finally, the reform remains silent on different points raised by previous projects. The liability of legal entities is not mentioned nor any reference to the precautionary principle. Some terms are not clearly defined such as harm and reference to environmental harm or indirect victim prejudice. Thus, in order to avoid uncertainty, these omissions should be reviewed and supplemented.

As it stands, the preliminary draft of the civil liability reform, long-awaited, tries to establish a modern law. If adopted, this could serve as a model for foreign legal systems. However, some deficiencies have been identified, which would perhaps be adjusted after analysis of the contributions provided by the public consultation.

Ozan Akyurek is a partner at Jones Day. He can be contacted on +33 1 56 59 39 39 or by email: oakyurek@jonesday.com.